Transactions With Related Parties

3 Months Ended

Mar. 31, 2014

Related Party Transactions [Abstract]

Transactions With Related Parties

Transactions With Related Parties

Upon closing our initial private offering, we acquired the proprietary, vertically integrated real estate acquisition and management platform of American Residential Management, Inc., or ARM, a company co-owned by our founders, Stephen G. Schmitz, our Chief Executive Officer and Chairman, and Laurie A. Hawkes, our President and Chief Operating Officer, pursuant to a contribution and sale agreement between our Operating Partnership and ARM. As consideration for our acquisition, our Operating Partnership issued 175,000 OP units, valued at $3.5 million, representing a 1.5% limited partnership interest in our Operating Partnership at that time, and we paid approximately $85,000 in cash. The OP units were valued at $20 per unit, equivalent to the offering price per share of our common stock sold in our initial private offering.

In February 2013, our TRS entered into a management agreement directly with ARP Phoenix Fund I, LP, or Phoenix Fund. The general partner of Phoenix Fund is ARP Phoenix Fund I GP, LLC, which is owned by Mr. Schmitz and Ms. Hawkes. The services our TRS provides to Phoenix Fund include property restoration, leasing and property management and disposition services with respect to the properties owned by Phoenix Fund. Our TRS provides these services to Phoenix Fund for a fee in an amount equal to 6.0% of the gross rental revenue received by Phoenix Fund with respect to the properties managed by our TRS.

We earned approximately $0.1 million in property management fees during each of the three months ended March 31, 2014 and 2013, which are included in management services (related party) in our condensed consolidated statements of operations and comprehensive loss. Accounts receivable of approximately $5,000 and $43,000 due from Phoenix Fund and ARM are included in due from related party in our condensed consolidated balance sheets at March 31, 2014 and December 31, 2013, respectively.

Phoenix Fund purchased 150,000 shares of our common stock in our initial private offering.